Navy’s Next Major Ship Program Sees Challenges Balancing Requirements and Cost

SAN DIEGO, Calif. – The Navy’s new requirements process that brings industry in early to refine ideas and conduct prototyping may have prevented the service from going down a costly path with its Large Surface Combatant, the head of Naval Sea Systems Command said.

Acquisition leaders have touted the Requirements Evaluation Team idea, which brings together program managers, operators, budget officers, industry and labs early on to create requirements that meet warfighting needs while being fiscally realistic. The guided-missile frigate program, currently in source selection, is the first major program this process has been used in, and the feedback has been resoundingly positive.

However, the RET process was later used on the Large Surface Combatant program that will follow the Flight III Arleigh Burke destroyer program, as well as the Common Hull Auxiliary Multi-mission Platform (CHAMP) program that will replace a handful of Military Sealift Command ship classes – and in both those cases, the process didn’t come up with any ideas with a price tag the Navy could live with.

Asked by USNI News whether that showed the RET process had flaws or whether the process saved the Navy from pursuing something that would ultimately prove too expensive to buy, NAVSEA Commander Vice Adm. Tom Moore praised the RET process.

“I don’t think there’s a limitation to the process, I think the process is right. I think the key to the requirements is, what is it exactly that you want, and then getting a realistic cost on what that is. And those two tend to collide often,” he said.
“So I’ve watched the Large Surface Combatant with great interest over the last four years, and frankly I think we’ve pushed it to the right for good reasons: we think Flight III meets the needs, we think the threat’s evolving, we’re looking at unmanned, so we don’t want to rush into this. But clearly as we work through that process, the first go-around was a platform that was going to be pretty expensive. You’re hearing the secretary, the [chief of naval operations] talk about Distributed Maritime Operations, you’re hearing them talk about high-low mix; does everything have to be a high-end [platform]?”

The Navy has made clear that it wants to rely more heavily on smaller ships like the frigate to conduct Distributed Maritime Operations, pushing lethal capability out to many more locations than can be done when combat power is concentrated on fewer large platforms. However, the service has also said it needs a large platform to bring large radars and large missiles into the combat theater. Balancing the need for large ships and the need to reinvest money into small combatants and unmanned combatants has proven challenging for the service.

“I think the requirements evaluation team process works, I think it’s the best way to do it, and I think involving industry early is the best way to do it. But you’re going to have to have some cross realism in there upfront in terms of defining the, hey, I’m not willing to pay more than this. And those two often collide too late in the game,” Moore concluded.

In the case of Large Surface Combatant, that realization that the ship would cost more than the Navy was willing to spend came after a couple of years of talks with industry but without any major investments into the program such as conceptual design contracts. This comes in contrast to programs like the Zumwalt-class destroyer program, which grew in cost and showed technical challenges once heavy investments had been made; in that program, the Navy bought three hulls for a program cost of about $22 billion total.

The commander of Naval Air Systems Command, Vice Adm. Dean Peters, said during the same panel that the requirements-generation process could benefit from not only bringing in industry early for talks, but also for prototyping work.

As the operating environment and therefore requirements for new weapons become more complex, “to the extent that we can prove out technology – our normal acquisition process where we release a [request for proposals], we get proposals back and then we go through this evaluation process where we’re really trying to see on paper who understands the requirement the best, but really have no sense of what that capability will bring, what the reliability of that capability is – so to the extent that we can get in early with some of this prototyping , some of our most successful programs from an acceleration standpoint have been in those situations where we could prove out the technology before we had to go through the acquisition process,” he said.

Navy acquisition chief James Geurts told senators earlier this month that the Navy was taking a “strategic pause” with Large Surface Combatant to make sure the service did sufficient detailed requirements development and prototyping work.

In the meantime, he vowed to keep Flight III DDG production flowing.

USS Zumwalt (DDG-1000) departs San Diego as part of an operational underway on March 8, 2019. US Navy Photo

“If we’re going to compete and win at a global scale … Flight III DDGs are going to be a firm backbone of that,” Geurts told the Senate Armed Services seapower subcommittee on March 4.

Flight III DDGs are being built under a multiyear procurement contract that covers fiscal years 2018 through 2022. Large Surface Combatant was previously meant to follow heel-to-toe behind that but has since been delayed several times.

“While I have not formally declared that, I can’t see a scenario where we wouldn’t for the remaining destroyers (until) Large Surface Combatant comes into play, we wouldn’t do a multiyear or some similar kind of arrangements. We don’t want to get that transition point wrong. We need both capabilities, but we’re not going to put the Flight III destroyers at risk for the Large Surface Combatant,” Geurts said during the hearing.

Vice Adm. Jim Kilby, the deputy chief of naval operations for warfighting requirements and capabilities (OPNAV N9), said during the same hearing that detailed design work on LSC would take place in 2028 and that lessons learned from the frigate RET process would inform that work.

“There’s a very real need to get after that and to continue to produce Flight III just because of the pacing threat” from China, he said, noting the need to support both DDGs and LSC.
“The Flight III I think will be a consistent platform for us well into the future until we’re sure we have Large Surface Combatant in hand.”

About Megan Eckstein

Megan Eckstein is the deputy editor for USNI News. She previously covered Congress for Defense Daily and the U.S. surface navy and U.S. amphibious operations as an associate editor for Inside the Navy.